If you know anything about Uber, you know that the ride-hailing service hates -- hates! -- being regulated. Uber has pulled out of cities that have tried to impose taxicab-like licensing requirements on its drivers and vehicles, fought against efforts to classify its drivers as employees, and flouted restrictions on where its drivers can pick up passengers.
The fatal shootings Saturday night in Kalamazoo, Mich., allegedly by an Uber driver during his work shift, point to another category of regulations the company has been fighting hard: background checks. Uber last year threatened to pull out of Austin, Texas, if the city required fingerprinting of its drivers.
In Los Angeles alone, registered sex offenders, a kidnapper, identity thieves, burglars and a convicted murderer had passed Uber’s ‘industry leading’ background check.
The company is fighting a lawsuit filed by the district attorneys of San Francisco and Los Angeles counties, who allege that the safety checks it does perform of driver applicants have been all smoke and no substance (even though it has been charging passengers a “safe drive fee,” ostensibly to cover such checks).
The Kalamazoo shootings are likely to direct the spotlight onto the company’s policy on background checks. That’s ironic, because thus far there’s been no evidence that even the most stringent such investigation would have uncovered any problem with the alleged shooter, Jason Brian Dalton, 45, who was arrested after the shootings, which claimed the lives of six people apparently chosen at random.
Authorities say Dalton doesn’t have a criminal record or a neighborhood reputation as a troubled individual. Nothing has surfaced thus far indicating that he had a history of violence or mental instability. From Uber’s standpoint, the most disturbing element of his alleged afternoon and evening of gunplay is the indication from passengers that he continued to pick up fares in between shootings, and that at one point during the shift he began to drive erratically -- so much so that one passenger fled his vehicle and dialed 911.
Still, the incident will heighten concerns among potential passengers about the strangers whose cars they hail via the smartphone apps of Uber and other ride-hailing companies such as Lyft. Those concerns already had been sparked by reports of violent incidents around the country and abroad involving drivers. That suggests that the best course for the companies is to put some substance behind their claims of safety checks and stop fighting.
The sharpest fight over background checks is currently being waged in Austin, where the City Council last year mandated fingerprint checks for all drivers working for “transportation network companies,” the catch-all label for Uber- and Lyft-like services.
Although both companies threatened to leave Austin if fingerprinting was mandated, the ordinance passed in December. Scheduled to go into effect at the end of this month, it requires drivers to pass a fingerprint-enabled background check by February 2017. Those who don’t do so may not be barred from driving at all, but could be banned from some of the most lucrative pickup spots and events, such as the airport and the Austin City Limits and South by Southwest cultural gatherings.
The companies made it clear to Re/code that they’re unhappy with the rule. Lyft complained that “segregating rideshare drivers into different groups, with different economic opportunities ... hurts drivers, consumers and the city of Austin.” Uber said that the program “would penalize drivers who are unable to complete the city’s duplicative background check by revoking their access to critical earning opportunities. It would also leave riders stranded when they most need a ride.”
Uber’s crack about the “duplicative” program reflects its general complaint about government-mandated checks -- they just replicate what the company does already to ensure passenger safety. Safety authorities, however, say that adding fingerprinting to the process is a crucial element in making sure that the records retrieved in a background check are properly matched to the driver.
And what about those company background checks? According to the district attorneys’ lawsuit, they haven’t been anywhere near as rigorous as Uber claims. (Lyft settled a similar complaint from the prosecutors by changing the language of its background-check claim and paying a penalty of $500,000.) As late as mid-2015, Uber was telling customers that it conducted "industry-leading” background checks that made its service the “safest rides on the road.” It charged a “safe rides fee” of $1 per passenger on every ride.
Over time, the company ratcheted back those claims, according to the lawsuit -- changing “industry-leading” to “constantly improving,” for instance. For good reason: The district attorneys found that “in Los Angeles alone, registered sex offenders, a kidnapper, identity thieves, burglars and a convicted murderer had passed Uber’s ‘industry leading’ background check.” The absence of a fingerprint check alone dropped Uber’s standard below that of taxicab companies, which are mandated in California to run fingerprint checks on drivers.
The company is still fighting the case, but earlier this month it moved to settle a separate class-action complaint over the “safe rides” fee by paying $28.5 million to 25 million drivers. Uber agreed to rename the fee a “booking fee,” which only raises the question of what it’s really for, since the company already keeps 20% of every fare to cover its expenses and profit.
The underlying question raised by Uber’s hostility to regulation is who benefits. Certainly its investors do in the short term, since regulation costs money and they get to pocket more. But even if the Kalamazoo shooter went off the rails in a totally unpredictable way, the incident underscores doubts about who’s driving you, especially late at night or on isolated routes. That can’t be good for passengers or the company’s reputation. In the long run, it may be wiser for Uber to fall into line on background checks and other such rules. Its own reputation for safety is at stake.